Finance Secretary and Chair of the Intergovernmental Group of Twenty-Four (G-24) Board of Governors Ralph G. Recto has urged member states to reclaim their lost momentum and make a powerful comeback in the race to 2030 through heightened cooperation and scaled-up support from international financial institutions to weather global challenges.
“We must keep in mind that 2030 marks a universal deadline for all nations to make substantial progress in eradicating poverty, ending hunger, and protecting the environment,” Secretary Recto said in his opening remarks for the G-24 Technical Group Meeting (TGM) on February 21, 2024.
“With over half a decade remaining until 2030, there is enough opportunity for developing economies to reclaim lost momentum and make a powerful comeback if we unite in concerted action and adhere to fiscal discipline,” he added.
The 2030 Agenda for Sustainable Development is a universal action plan that balances economic, social, and environmental goals.
Formed in 1971, the G-24 helps coordinate the positions of developing countries on international monetary and development finance issues, as well as to ensure that their interests are adequately represented in negotiations on international monetary matters.
This year, the Philippines is hosting a two-day G-24 Technical Group meeting with the theme, “Building Resilience to Meet Global Challenges” to discuss strategies to efficiently address ongoing economic challenges including climate financing, changes in global trade regime, resource mobilization, and sovereign debt resolution, among others.
Secretary Recto stressed that the COVID-19 pandemic inflicted a severe blow to the global economy, halting its growth momentum and leaving middle and low-income countries with constrained fiscal resources and mounting debt burdens.
As economies strive for sustainable recovery, he said the lingering effects of COVID-19 continue to loom over the post-pandemic world as developing nations find themselves in a post-COVID landscape with little to no fiscal buffer amid tighter credit conditions and higher costs of borrowing.
This is being exacerbated by the worsening impacts of climate change disproportionately affecting vulnerable countries as efforts for mitigation and adaptation continue to lag behind.
In addition, global trade faces continued strain due to geopolitical tensions, resulting in increased imbalanced trade deficits and a rising inflationary environment.
“All these headwinds persist while countries like ours face the dilemma of achieving fiscal consolidation to restore pre-COVID levels of growth and address widening inequality and food insecurity,” the Finance Chief emphasized.
The World Bank (WB) expects global growth to decline for the third year in a row, reaching 2.4 percent in 2024 and 2.7 percent in 2025—significantly lower than the pre-pandemic average of 3.1 percent.
“We are witnessing the weakest global growth in any half-decade since the 1990s, with one in every four developing countries now poorer than prior to the pandemic,” Secretary Recto said.
He stressed that any slowdown in global economic performance will certainly hit developing economies, threatening the peace and prosperity of people worldwide.
“We have now reached a critical threshold. Without decisive and major corrective actions to protect our hard-won gains, the developing world is at the risk of falling even further behind,” Secretary Recto warned.
With this, the Finance Chief called on international financial institutions such as the Asian Development Bank (ADB), the WB, and the International Monetary Fund (IMF) to redouble their efforts in helping developing countries mitigate and reverse the factors that threaten growth prospects.
“Traditional interventions are no longer sufficient. We need bold and innovative solutions to help developing economies sustain productivity, boost long-term growth prospects, and increase resilience to economic shocks,” he said.
Through the G-24 meeting, Secretary Recto said the Philippines seeks to facilitate open dialogue and stronger collaboration with international financial institutions and member countries to build up respective capacities to weather global challenges.
He urged G-24 members and international partners to focus discussions on crafting fiscal frameworks that promote fiscal consolidation, widen trade and financial flows, and cultivate a more favorable investment environment for the private sector.
According to the WB, per-capita investment growth in 2023 and 2024 is projected to average a mere 3.7%, which is half of the average seen in the preceding two decades.
However, the WB suggests that every developing nation should achieve at least 4% per-capita investment growth for six consecutive years to have a chance at regaining lost momentum.
“[W]e must develop strategies to efficiently mobilize fiscal resources and prevent leakages as much as we can, not only to manage debt but to provide protection to our people in these difficult times,” Secretary Recto added.
Moreover, the G-24 Chair expressed the need to balance economic growth with climate objectives, as well as devise innovative funding mechanisms for climate adaptation and mitigation aligned with the country’s development priorities.
Greater international cooperation is also needed to support debt sustainability initiatives, he said.
“These are urgent concerns on the table that demand our immediate action. I trust that the deliberations of this technical group meeting will yield bold solutions and ideas that will benefit all of us and the future generations to come,” Secretary Recto stressed.
Finally, he called on the G-24 to collectively strengthen their macroeconomic fundamentals to steer the global economy faster and further on the road to inclusive and irreversible growth.
Though originally named after the number of the founding member-states, the G-24 now has 29 members, namely: Algeria, Argentina, Brazil, China, Colombia, Congo, Côte d’Ivoire, Ecuador, Egypt, Ethiopia, Gabon, Ghana, Guatemala, Haiti, India, Iran, Kenya, Lebanon, Mexico, Morocco, Nigeria, Pakistan, Peru, Philippines, South Africa, Sri Lanka, Syria, Trinidad and Tobago, and Venezuela.
